Rethinking high-speed

As Europe’s budget airlines spread across the continent, railway operators are having to rethink the way they do business.

A new alliance of seven high-speed train operators aims to give short-haul airlines a run for their money by improving price and convenience on international high-speed rail routes.

The Dutch, Austrian, Swiss, French and German national rail companies, plus the high-speed TGV, Thalys and Eurostar operators announced on 2 July the ‘Railteam’ alliance. The crux of the alliance will be a €30 million system to connect ticket distribution systems, which will eventually allow travellers to buy a ticket for any Railteam service from any other member of the alliance or online. With the new system, travellers will have one website where they can book tickets for high-speed trains. Schedules will be co-ordinated between operators to achieve the fastest possible connections, with less hassle between trains. In addition, passengers who miss a connection because of a delayed train will be guaranteed a place on the next available train.

Railteam argues that passengers tend to prefer taking the train if the train is at least half as fast as flying and twice as fast as driving. Theoretically Europe’s high-speed trains are well positioned to compete, despite the growth of budget airlines, since trains have already beaten airlines between many destinations. Deutsche Bahn spokesperson Andreas Fuhrmann points out that few planes fly any more between Cologne and Frankfurt airport. A high-speed line makes taking the train far more convenient, especially considering time spent getting through airport security and the potential for delays. Lufthansa, whose hub airport is in Frankfurt, operates a code-share with inter-city express trains from Stuttgart and Cologne to Frankfurt airport. Passengers check in for their flight at a Lufthansa desk in the train station, check their bags, and board a 200 kilometre/hour train directly to the Frankfurt terminal for their connecting flight.

The alliance seeks to counter the national fragmentation of the passenger rail market that is one of the biggest obstacles to its competitiveness with airlines. The liberalisation of the air market in the 1990s was a prelude to much lower airfares.

But passenger train operators have only recently been pushed in a similar direction, by governments and competitive pressure.

The European Parliament and the Council of Ministers agreed a deal last month (20 June) on the third package of railway legislation, which includes proposals to open up international passenger services to competition from 1 January 2010. The package also includes a law on passenger rights such as the right to a refund in the event of a delay and a law on a driver certification scheme that allows drivers from one member state to operate trains in another. Driver credentials can be an obstacle to international traffic, with drivers on many international routes changing at border stations.

The package is expected to be given final approval by MEPs in September.

Despite the current fragmentation of the market, high-speed trains do appear to be competitive over international routes. Groups opposed to the expansion of London’s Heathrow airport last month organised a ‘race’ from Big Ben to the Eiffel tower to demonstrate that taking the train to Paris was a better choice than flying there. Those taking the cross-channel Eurostar train arrived in Paris five minutes before the plane, which was delayed, took off from Heathrow. In addition to speed and punctuality, high-speed train journeys are ten times better for the environment, according to Railteam. A recent pledge by Eurostar to buy carbon credits allows the service to stake a claim to being carbon neutral.

Direct competition with airlines will be made possible by extensions in Europe’s high-speed rail network that have either been recently completed or are in the works.

A new high-speed line between Frankfurt and Paris will serve as a key connection for the network, directly connecting France and Germany’s high-speed networks. Those living in Brussels are well placed to benefit from the alliance. Improvements on the high-speed track to London should cut journey times by 20 minutes on the Eurostar. A new high-speed line through the Netherlands and a line from Liège to the German border are set to open soon, which will speed up journey times from Brussels to urban centres such as Amsterdam, Rotterdam, Cologne and Frankfurt.

While Railteam will not directly affect the price structure of high-speed lines, many operators are responding to the challenges of discount airlines. With the new Paris-Frankfurt line, Deutsche Bahn offered special tickets for €29 and sold 17,000 of them.

The low-cost airlines have changed the rules of the game. Having shown they can compete for speed and convenience, railways now have to show that they can compete on price.

As Europe’s budget airlines spread across the continent, railway operators are having to rethink the way they do business.